What is Suspicious Activity Reporting (SAR)?

Suspicious Activity Reporting (SAR) is the process of formally reporting unusual or potentially criminal financial behaviour to the authorities, most often when there’s a suspicion of money laundering or terrorist financing.

These reports are vital tools used by financial institutions and professionals to help law enforcement detect and stop financial crime.

But what exactly does a Suspicious Activity Report involve? Who files them and what triggers a report?

Whether you’re a business owner, work in a regulated industry sector, or are just curious about how financial crime is detected, our article breaks it all down.

What is a Suspicious Activity Report (SAR)?

A Suspicious Activity Report (SAR) is a formal document submitted to the authorities, usually the UK’s Financial Intelligence Unit (which sits within the National Crime Agency), to flag suspicious transactions or activities that could relate to criminal conduct, like money laundering, fraud, or terrorist financing.

Suspicion does not require certainty or evidence of a crime being committed.

It’s enough that the activity in question appears unusual, inconsistent with a customer’s known behaviour, or difficult to explain within the scope of legitimate business.

SARs are confidential and protected by law.

The person or organisation under suspicion must not be told that a report has been filed.

This is commonly known as tipping off, and is a criminal offence.

Importance of Suspicious Activity Reports (SARs)

SARs play a critical role in fighting financial crime.

They act as early warnings, intelligence leads, and investigative starting points for law enforcement and intelligence agencies.

Without SARs, authorities lose access to major sources of financial intelligence.

Every year, hundreds of thousands of SARs are submitted by banks, accountants, estate agents, solicitors, and other regulated businesses.

These reports help uncover criminal networks, track illicit funds, and prevent the abuse of the financial system.

SARs are not only about catching criminals, they help protect institutions from legal liability and reputational damage, by demonstrating compliance with regulatory duties under laws like the Proceeds of Crime Act 2002 (POCA).

Why are Suspicious Activity Reports (SARs) Filed?

There are several reasons why SARs are filed, all of which contribute to maintaining the integrity of the financial system and supporting the work of law enforcement agencies.

Financial crime detection

SARs help uncover and investigate a wide range of financial crimes, including:

• Money laundering
• Terrorist financing
• Fraud
• Corruption
• Tax evasion

By flagging suspicious transactions early, these crimes can often be disrupted or prevented completely.

Legal and regulatory compliance

Under UK law, professionals are required to report any knowledge or suspicion of criminal property.

Failure to do so could lead to prosecution.

Filing a SAR ensures you’re meeting your legal obligations and protecting yourself and your organisation from penalties.

Information sharing

SARs form part of a broader information sharing system between private businesses and public authorities.

When submitted, they become part of a national intelligence system used by law enforcement to build cases and understand criminal behaviour.

Early warning systems

SARs often act as red flags that prompt further investigations into individuals or an organisation’s financial conduct.

In some cases, SARs can help identify previously unknown criminal activity.

Prevents financial system abuse

By detecting and reporting suspicious activity, institutions help ensure services are not used to conceal, move, or launder illicit funds; maintaining trust in financial systems.

Who’s Required to File a Suspicious Activity Report (SAR)?

In the United Kingdom, SARs are most commonly filed by individuals working in sectors subject to anti-money laundering regulations.

These are referred to as the regulated sector, and include:

• Banks and building societies
• Accountants and auditors
• Solicitors and legal professionals
• Estate agents and letting agents
• Casinos and gambling establishments
• Cryptoasset exchanges and wallet providers
• High-value dealers (e.g. businesses accepting large cash payments)

If you work in one of these professions and you know or suspect that a person is engaged in money laundering, or that criminal activity is involved, you must file a SAR.

Even individuals or organisations outside the regulated sector can file a SAR voluntarily if they have genuine concerns.

Agencies that Use Suspicious Activity Reports (SARs)

Once submitted, SARs are processed and used by a wide range of agencies that work to tackle crime and protect the financial system:

Financial Crimes Enforcement Network (FinCEN)

While FinCEN is the U.S. equivalent to the UKFIU, it’s sometimes relevant in cross-border investigations involving UK and US institutions.

For UK purposes, FinCEN may collaborate with UK agencies on international financial crime cases.

UK Financial Intelligence Unit (UKFIU)

The UKFIU is the central body that receives, analyses, and distributes SARs to relevant authorities.

It forms part of the National Crime Agency (NCA) and plays a vital role in financial intelligence gathering.

Law enforcement

Police forces across the UK use SARs as investigative tools.

They may request further information or act immediately if the SAR points to urgent threats.

Intelligence agencies

SARs are used by UK intelligence agencies to monitor national security risks, including terrorist financing and organised crime.

Financial regulators

Regulatory bodies like the Financial Conduct Authority (FCA) use SARs to monitor compliance within the financial sector to take enforcement action when necessary.

International organisations

Bodies like Europol and the Financial Action Task Force (FATF) may use SAR-related intelligence to tackle transnational crime and promote global anti-money laundering standards.

What Triggers a Suspicious Activity Report (SAR)?

There is no definitive list of what constitutes suspicious activity.

However, some of the more common triggers include:

Large cash deposits

Sudden or unexplained cash deposits above normal thresholds, particularly from individuals or businesses not typically handling large sums.

Large withdrawals

Significant or repeated cash withdrawals, especially when there’s no clear reason or pattern that fits this behaviour.

Frequent transfers between high-risk jurisdictions

Transfers to or from countries known for weak anti-money laundering controls or with high levels of corruption.

Transactions involving known criminals

Deals involving individuals or entities already under investigation or flagged by authorities.

Transactions involving unlicensed money services

Sending or receiving funds through businesses that lack proper regulatory authorisation.

Behaviour inconsistent with customer’s usual activity

A long-standing customer suddenly changes their financial behaviour.

For example, engaging in high-risk transactions, unexplained wealth, or unusual account use.

Behaviour consistent with money laundering or terrorist activities

Examples include complex layers of transactions designed to hide the origin of funds, use of false documents, or business activity inconsistent with declared income.

What Information is Filed in a Suspicious Activity Report (SAR)?

Filing a SAR involves providing clear, factual information that allows authorities to understand the nature of the suspicion.

The report generally includes:

Identity

Full details of the individuals or organisations involved, including names, dates of birth, addresses, and any known identifiers (e.g. account numbers, passport numbers).

Background

Context about the relationship between the filer and the subject.

For example, whether they are a client or a customer, and how the activity was discovered.

Reason for Report

A concise explanation of why the activity is suspicious, including any red flags, inconsistencies, or concerns.

Transaction Details

Dates, amounts, account numbers, payment references, currencies, and descriptions of the transactions involved.

Source of Funds

Where applicable, the suspected or known origin of the funds in question, especially if there are doubts about its legitimacy.

Compliance Officer

In organisations subject to regulation, the SAR will usually be submitted by or through a Nominated Officer (also called the Money Laundering Reporting Officer, MLRO).

SARs can be submitted online via the NCA’s SAR Online portal, or via secure routes for large organisations using batch submissions.

Key Takeaways

Suspicious Activity Reporting (SAR) is a key player in the UK’s defence against financial crime.

Whether you work in banking, legal services, real estate, or another regulated industry sector, understanding your responsibilities around SARs isn’t just a legal requirement; it’s part of maintaining integrity in financial ecosystems.

A SAR doesn’t require you to prove wrongdoing; only that something doesn’t feel right based on the facts available.

And by reporting anything suspicious, you help safeguard the UK’s economy from abuse, protect your business from criminality, and help the global fight against money laundering and financing terrorist organisations.